Powered by the people: 3 altcoins whose tweet volume spiked before a strong rally
On Crypto Twitter, a surge of attention directed at a coin oftentimes comes in response to dramatic toll activeness. Quite naturally, rallying avails attract the attending of traders and take over Twitter conversations, which can also create positive feedback loops that further prop upwardly the momentum.
This is exactly what happened with some of the coins that saw a greater increase in boilerplate daily tweet book this month, compared with the last. KuCoin Shares (KCS), which went up from $vii.40 on July iv to $14.20 on July 14, generated a staggering increase in average tweet volume, totaling more than 1,100% month-to-month.
Another big winner in terms of toll, Axie Infinity (AXS), added 456% in tweet volume over the same period. In both cases, tweets mirrored the rallies' dynamics, with the tweet volume bend closely following the price chart.
In other cases, however, the relationship tin be reversed. Sometimes, the Twitter crowd picks up the news or emerging narratives that the wider market has yet to absorb, producing tweet volume spikes that come before price increases. Is at that place a mode for traders to spot these dynamics early enough to proceeds an border over the rest of the pack?
Data intelligence for early birds
Tweet book is i of several metrics used to calculate the VORTECS™ score, an algorithmic indicator that compares complex patterns of market and social action of an individual digital nugget to years' worth of historical data.
Exclusively available to Cointelegraph Markets Pro (CTMP) subscribers, the algorithm assesses parameters such equally the market outlook, price move, social sentiment and trading activity to generate a score that shows how suitable atmospheric condition of the observed combinations are for any money at any given time.
On peak of that, there is a defended space on the Markets Pro dashboard featuring assets that see abnormal tweet volume in real-time. In one case they are alerted that something is brewing effectually a coin on Twitter, traders tin be incentivized to take a closer expect at the asset and make a judgment every bit to whether its price is likely to get up soon.
Hither are three examples from the concluding thirty days where Twitter activeness foreshadowed price action.
Crypto.com Coin
In the case of Crypto.com Money (CRO), the source of Twitter users' excitement is crystal clear: A few hours before the coin flashed on Markets Pro's Unusual Twitter Volume box (red circle in the nautical chart), information technology emerged that CRO became the first digital asset platform to partner with the Ultimate Fighting Championship, or UFC. The declaration was too delivered to Markets Pro users seconds subsequently the original source published information technology, thanks to the platform's instantaneous NewsQuakes™ functionality.
Unsurprisingly, the big news triggered a sprawling Twitter conversation. If traders had not been convinced by NewsQuake™ and coin's ascent VORTECS™ score, the skyrocketing tweet volume could be the final statement in favor of opening a CRO position. The coin had been valued at $0.113 when tweet volume peaked on July 8, and it kept climbing in the adjacent four days, eventually hitting $0.132 before the price began to refuse.
Quantstamp
Establishing what had triggered the surge of tweets referencing Quantstamp (QSP) around June 1 is less straightforward. One potential reason could be the launch of oneFIL, a stablecoin for the Filecoin customs, around that time.
The protocol behind oneFIL is audited by Quantstamp. While QSP generates just a handful of Twitter mentions per mean solar day, on July 1 it got over 150 tweets, immediately putting it on the Markets Pro radar (cherry-red circumvolve in the graph). While the tiptop tweet book corresponded to the QSP cost of $0.030, the money pulled off a strong functioning in the following days, reaching $0.034 on July four, continuing to push farther.
Period Dapper Labs
Flow Dapper Lab'due south (FLOW's) peak tweet book came late on July x (scarlet circle in the graph) in response to a highly successful calendar week that the asset had, more doubling its price from $9 to over $18.
A loftier VORTECS™ score that FLOW received some 50 hours earlier indicated that in the past, such rallies unfolded in several rounds and that historical precedent suggested a possibility of the second leg. Sure enough, the toll kept climbing even after the wave of tweets began to recede, eventually hitting $21.20
These examples demonstrate that, while an onslaught of tweets alone is not always a straw of an impending rally, spotting abnormal Twitter activity early on can lead to a profitable trade. It tin can be especially useful when combined with other metrics and a robust agreement of the coin-specific context.
Disclaimer.Cointelegraph is a publisher of financial information, not an investment adviser. We do not provide personalized or individualized investment advice. Cryptocurrencies are volatile investments and carry meaning adventure including the risk of permanent and total loss. Past performance is not indicative of future results. Figures and charts are correct at the time of writing or as otherwise specified. Live-tested strategies are not recommendations. Consult your fiscal advisor before making financial decisions. Full terms and conditions .
Source: https://cointelegraph.com/news/powered-by-the-people-3-altcoins-whose-tweet-volume-spiked-before-a-strong-rally
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